News

Santa Clara County Supervisor George Shirakawa racks up lavish expenses on public's dime

By Karen de Sá and Tracy Seipel Mercury News

Posted:
11/17/2012 04:00:00 PM PST

Updated:
11/17/2012 05:30:59 PM PST

Living the high life, Santa Clara County Board of Supervisors President George Shirakawa Jr. teed off at the Revere Golf Club last fall -- just minutes from the Las Vegas strip -- and charged the $583 bill.

When the burly, red-cheeked public official flew to the East Coast last year for a violence prevention forum, he upgraded to first class -- quadrupling his airfare to $2,605.

Shirakawa enjoyed these perks even though he didn't have a penny to his name, according to bankruptcy court filings. The veteran county leader declared personal bankruptcy in March 2011, despite his $143,031 salary. And the lavish expenses? County taxpayers picked up the cost.

Shirakawa may be broke, but the 50-year-old supervisor has a history of spending freely with taxpayer funds. And with lax county oversight, his constituents have no idea they've been paying as Shirakawa dines with his staff members and a who's who of San Jose leaders in what in many cases appears to be a violation of county policy and federal law.

Over the past four years, Shirakawa has gone on a free-wheeling $36,717 spending spree with his county-issued "P-card," dining out at least 180 times -- often in some of the region's most exclusive restaurants.

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Shirakawa's spendthrift behavior as supervisor since 2009 is now the subject of an expanding criminal inquiry by local prosecutors. He is simultaneously under investigation by the state's political watchdog agency, and he is facing tens of thousands of dollars in fines for missing campaign finance reports from his 2008 run for office. Some of the abuses of the credit card and missing campaign finance reports first were reported in the weekly Metro newspaper.

Revelations of Shirakawa's lavish spending are forcing the county to tighten its policies governing how supervisors and other county executives with credit cards spend the public's dime. The board will discuss the expense cards at its meeting Tuesday.

But Shirakawa's scandalous expense account is adding to a series of questionable practices by this son of a respected San Jose politician; he has come under fire for such things as failing to pay income taxes and arranging for his friend to be his $90,000-a-year bodyguard.

Publicity of Shirakawa's latest troubles has angered many in his working-poor district.

"I'm offended that one of our elected officials would conduct his affairs in such a disgraceful manner," said former Supervisor Blanca Alvarado. "That he thinks he's above the law and uses his position for self-privilege -- it's shameful, it's disgraceful, it's very hurtful."

As president of the Board of Supervisors, Shirakawa oversees a $4.2 billion budget for a county whose voters just approved a 10-year tax hike after years of recession that obliterated a host of social services. Yet documents show he has managed his personal and professional life with, at the very least, careless disregard. At most, authorities note, his behavior could be criminal.

Local policies and federal law explicitly prohibit the use of public funds for alcohol, donations and pure entertainment -- all of which Shirakawa appears to have charged to taxpayers. County policy also limits what top officials can charge for meals -- $30 is the maximum for dinner, for instance -- and Shirakawa routinely blows through those limits. In all cases, itemized receipts are required.

But in Shirakawa's case, he has regularly been unable to provide the receipts. Instead, on almost 250 charges over the past four years he has filed dozens of far less detailed "Missing Receipt Memos," such as the one for a $548 dinner at the Fairmont Hotel with San Jose police Chief Chris Moore and his police command staff earlier this year. Moore told this newspaper he had no idea the dinner was being charged to the county. He has since reimbursed the county for $400.

Shirakawa and his top-level staff members have denied repeated interview requests, although he prepared a statement in September: "For 20 years, those I represent know that I've always been open and transparent about my public affairs." He takes his public duties seriously, he added, standing up for the most vulnerable and completing his administrative duties "in a timely manner."

To be sure, some of Shirakawa's questionable spending has alarmed county auditors and led to reimbursements. Mostly, he has had to mop up after county-funded trips to casinos, luxury resorts and golf courses. On at least 16 occasions over the past two years, Shirakawa has reimbursed the county for questionable expenses totaling almost $5,200 -- including a payment to the California Democratic Party of $195. Since 2009, Shirakawa has paid back what he described as "inadvertent" charges from the Rio resort in Las Vegas, Harveys Casino in Stateline, Nev., the Thunder Valley resort and casino in Lincoln, Calif., and Los Lagos Golf Course in San Jose. He also repaid the county for the $583.78 he spent at the desert canyon Revere Golf Club, where he stayed in early October 2011.

Shirakawa's troubles are not lost on colleagues of his late father, George Shirakawa Sr., who was highly regarded during his days as a San Jose councilman.

"My heart goes out to him -- it should not have gotten this far. Why, why George, why? I just can't come up with an answer," said Frank Fiscalini, a former City Council colleague who was a friend of his father's.

Meanwhile, his four board colleagues used their cards far more judiciously, public records reveal. At most the other supervisors charged only a handful of restaurant bills. Although Supervisor Dave Cortese spent slightly more than Shirakawa -- $41,893 over the past four years -- the charges were mostly for office supplies, parking and some airline travel.

Shirakawa went so far as to use his card for charitable contributions, such as $2,500 to a local school district education foundation, and to buy a $394.86 high-definition television and a classy $627.85 see-through fridge for his county office.

Perhaps more alarmingly, no one at the county tried hard to stop him.

"There's a clear violation of county policy here," said county Assessor Larry Stone, "and quite frankly I'm surprised more by the lack of enforcement of the county than I am with the people who are allowed to get away with it."

Annual audits by the county controller's office -- in 2009, 2010 and 2011 -- revealed minor discrepancies with Shirakawa's expenses, but overall gave his office a thumbs-up, calling his credit card transactions "well-organized and maintained."

"It's not an oversight problem, it's a problem with the policies and procedures," insisted county Executive Jeff Smith, who would not comment on Shirakawa's case. "I don't think the issue is enforcement. I think the policies were confusing."

Confused or not, Shirakawa has had difficulty managing his own money, let alone the taxpayers'. In March 2011, the supervisor voluntarily declared Chapter 13 in U.S. bankruptcy court. But even there, Shirakawa has performed poorly.

Months into the legal process, court records show he was unable to provide a government-issued photo ID, proof of a Social Security number and a copy of his most recently filed tax return. Court filings reveal he checked "none" on his cash on hand amount, and a checking account balance of $0, although he reported $1,000 in "various guns and firearms."

Shirakawa regularly treats his core seven-member staff to lavish meals. Last year, a Dec. 20 holiday lunch at the Fairmont cost taxpayers $451.79; a "staff retreat" on Oct. 13, 2011, dinged the public for a $217.98 bill at the Cheesecake Factory.

Earlier this year -- before this newspaper in June exposed that Shirakawa had arranged for the county to hire his friend Alex Flores as his bodyguard -- taxpayers paid for the two to dine together for $56 on Feb. 1 at Red Lobster.

And in at least one instance, Shirakawa also rang up alcohol bills on his county-issued credit card, a clear violation of both local and federal rules on use of public dollars. A Feb. 17 $97.15 dinner at P.F. Chang's China Bistro included two Stella Artois beers, a Devil's Canyon Amber draft and a piña colada. Shirakawa's guests included San Jose's deputy city manager, Norberto Dueñas, and City Councilman Xavier Campos.

Public records show Shirakawa has a history of missteps.

After his first marriage ended in 1985, he failed to make court-ordered child-support payments, for which he was prosecuted and convicted in 1987 on a misdemeanor charge.

Over the years, he has had four tax liens placed on his property for unpaid state and federal income taxes.

In 1994, when Shirakawa Jr. was being considered to succeed his father on the City Council, Alvarado presided over a community meeting at which numerous women came forward to protest that appointment because of Shirakawa's failure to pay child support. Now, years later, Alvarado is revisiting those early warning signs.

"It pains me deeply," she said, "that a man the public put a lot of trust in would be so indifferent to that public."